Holding positions over weekend

Does anyone here holid positions over the weekend or do you see it as too risky?

Also if people make a trade on friday and do not plan to hold position over weekend, when do you close and what paramaters do you have on friday trading ie, buy before a certain time on friday and close on just before 7am saturday EST.

Any help much appreciated!!

Holding positions over the weekend is a no no for me. I don't like weekend uncertainties.

I barely trade on Fridays after 1pm. My positions are all closed whether positive or negative on Friday once I call it a week.

I've thought about it a couple of times. These are my conclusions:

What happens during the weekend can for now be assumed to be totally random, so the probability for a positive gap is just as big as a negative one.

So, when is keeping positions open over the weekend dangerous? Assuming you're trading with a fixed fraction of your account, large gaps to the negative side may exceed your stop-loss, and therefore generate losses bigger than initially expected. The probability of this happening depends on the distance from the Friday close to the stop-loss. The extent to which losses may exceed what you initially expected is determined by the distance from the entry to the stop-loss (i.e. the variables affecting position size).

Additionally, I would like to warn you that spreads generally widen during the late Friday nights, and early Monday mornings. This is an additional factor to consider. To give an example, I've seen Alpari UK spreads reaching 15+ pips on the majors. If you ask why they increase the spread, they will probably say it has to do with reduced liquidity, though I personally thinks its just a way to do some non-directional stop-hunting that they are able to justify with the reason I mentioned.

All in all, whether it is smart to keep a position open over the weekend depends on the trading style. Get a feel of how big gaps have been historically, and then determine the risks involved for your particular trade. Also keep in the back of your mind the increased spread. If you want to play it safe, don't keep your positions, but do consider the possible transaction costs involved with having to reenter a position.

If you have small acoount, you may keep positions over weekend.
But on the other hand a gap can be favorable but if not
gaps usually tend to retrace.

I wonder what fundamentals say about this.

hi i signed up to comment on this. holding trades over the weekend could be come risky. "double sided sword"

cheers

Here's a thread on the this topic I started several months back:

http://www.forexfactory.com/showthread.php?t=234477

Yeah,
I hold positions over the weekend all the time...but when I do I make sure my trading is in alignment with the overall trend and not some 15 min or lower time frame move.

-Mike

Do there exist accessible charts which show how price has moved over the weekend? I have a hunch these will show valid support/resistance levels.

Yea I do it all the time too. Just no point if you're only up or down a few pips. If it's like 100+ though I can't see anything short of invertention hurting you. Might not be a good moment at the now though as that, while unlikely during the early weeked (possible when the Japs open Sunday night), its being talked about.

An option is lets say you want to hold a position into next week but don't want to take on the weekend risk. You can exit your trade on Friday between 12-4pm, then come Sunday morning you can re - establish your position at the same level or you can wait for a dip which sometimes can happen.

Of course the risk you take is that the market gaps in your favor and doesn't look back, but you can at least sleep easy over the weekend.

All the time. If you trade small relative to your account then there is no worry. Oanda also pays rollover/swap 24/7 so good way to pick up some extra pennies. Oh, and you can also close your positions over the weekend with Oanda as well if you like. Say an unexpected headline comes out over the weekend that you think may adversely affect your position.

Disclaimer: I am not an Oanda representative.

Can someone help me analyse the graph of XAUUSD..please i need your help

If Price Action analysis is enough for you; then surely I can share my PA idea!

In my opinion, this is not the safest format, because I personally cannot afford not to control the situation directly when it comes to my money. I think that in any business you have to be able to make decisions and take responsibility for your actions, and I decided for myself that it is not safe for me, because even on weekends there can be events that will fundamentally change the market position. And you also have to think about this in advance, and it may happen that on Monday morning I will see zero in my account. And I am absolutely not satisfied with it. Although it should be noted that at Forex trades are possible for several months, and I have had such deals too, but only if I found an entry point using technical analysis.

For the Traders that know what they are doing, everything (without question) depends entirely upon the data you have accumulated through doing Research. "Too risky" might be "Low Risk" for somebody else. Different traders because of the differences in the data they obtained from their research, will have different definitions for "risk." Not every trader observes risk in the same way, because their research tells them different things about pending market behavior.

A deep position trader must (by definition) hold through not merely one weekend, but possibly many weekends up to several months at a time. But, that's a Deep Position Trader using a completely different kind of market analysis to support their decision. This type of trader is not overly concerned with things that bother other types of traders such as "spreads," "spread widening," so-called "price spikes," "commissions," "slippage," etc.. This type of trader works to make sure they are Building A Position in the market appropriate to their trading style and in-line with the empirical evidence supported and backed by their research.

So, research drives everything and answers all questions. If the Trader finds them self doing anything outside the parameters of their own research, then that trader has decided to travel a road they know nothing about. The research is core and essential to building the skill, knowledge and expertise about a particular approach to trading. Shifting outside that skill set only adds to "risk" long term.

When I am engaged in a Directional Trade, I can carry across the weekend only when the approach I'm using warrants it and by definition that approach will always include what's been thoroughly researched and vetted. When I am engaged in a Non-Directional Trade, I can carry across many weekends if/when necessary and do not have the need to monitor the trade day-to-day.

Again, research is everything. Essentially, research is God in Trading. I cannot imagine entering a trade that I have not spent enormous amounts of time previously researching, so that I can understand the historical maximum adverse nature and potential of that trade - keeping me calm if/when market adversity arises during the course of a future trade.

Trading absent Core Research is (IMO) pointless. I could have a lot more relaxing time at Vegas, enjoy some shows, good food, night life, golf and a few nice gun ranges while blowing my money with the Casino, where I have a high degree of probability for ending up on the wrong side of MAE/MFE. But, at Vega, who the heck cares - you are there to have fun. I have fun while Trading. However, having fun is not the ultimate goal or destination. Growing capital consistently through time and building a trading business is the ultimate goal.

Research... solves many problems.

Good day to all.

With regards to prop firms with such rules. What are their risks when traders hold their positions over weekends?

I have met a few which insist on this rule. Do they incur any risk when their traders leave positions open?
Shouldn't prop firms engage a larger range of trading styles to diversify their risk?

Hope to hear from anyone on this

best!!

Given the rate of how many prop firms have popped up over such a short time, they are definitely not capital-extensive. News over weekends can possibly result in huge losses, which is probably something prop firms do not dare to undertake. My suspicion is that when they provide someone with LIVE funds, for every $100,000 provided, I think they only have maybe $20,000 in real funds. Most prop firms offer 1:100 at maximum but we know 1:500 is very common. They could be doing an arbitrage here.